|
By Frank O’Brien It is an anomaly, more stark in Vancouver than anywhere else in the country: low-income owners living in million-dollar homes.
The median family income in the city is slightly above $54,000, but the typical detached house was worth $930,000 as of April 1, reports the Real Estate Board of Greater Vancouver. Plunk down even a hefty down payment on a dream home, and your monthly mortgage costs are about equal to the gross national product of an emerging nation.
According to a study by RBC Financial, “the cost for a standard detached bungalow in Vancouver requires 70.1 per cent of household income.”
For many in Vancouver, therefore, the pride of owning a million dollars worth of real estate is tempered with the fact that they must maintain it, let alone attempt to improve it.
Sure, there are second mortgages and lines of credit, but some owners, particularly older people, want to add as little debt as possible on top of their housing costs.
That is why it is important that the elderly, and working homeowners making a below-average income, know about any government help they can get for home repairs and medications.
Fresh money released this year from the federal government under its residential rehabilitation assistance program (RRAP), which offers grants for home repairs, is worth checking out.
Forgiveable loans
Nationally, a total of $384 million is available through Canada Mortgage and Housing Corporation (CMHC) for the programs over the next three years.
There are some caveats with the assistance, which can total up to $16,000 per applicant in the Vancouver area.
First of all, the applicant’s total household income must be below a maximum level as established by CMHC, which ranges from $27,500 to $43,500.
Also, the house must be at least five years old and must be substandard and in need of repairs in at least one of the following areas:
- Structural
- Electrical
- Plumbing
- Heating
- Fire Safety
- Work to reduce overcrowding may also qualify.
Under the program, repairs fall under two categories: mandatory repairs and eligible repairs.
In order to receive assistance though, the mandatory repairs must be completed. Forgivable assistance is provided for these repairs, which means the money will not have to be repaid.
The maximum amount of forgivable assistance in urban areas is $16,000, but this increases to $19,000 for the northern part of Canada.
The forgiveness available is based on a homeowner’s total household family income. The homeowner is expected to own and occupy the home during this time.
How to get the money
The process of approval for the RRAP program is as follows:
- A CMHC housing loans officer and homeowner meet, RRAP application is filled out, proof of income is provided, and eligibility determined.
- The house is inspected by a building inspector, and a list of repairs is created.
- Homeowner obtains a minimum of three written cost estimates from contractors.
- Housing loans officer and homeowner meet and finalize loan details.
- Application is sent to CMHC.
- Once approved, homeowner contacts contractors to do work.
- Once work is complete, the building inspector inspects and approves work.
- The contractor, through the housing loans officer at CMHC, requests payment.
- Payment from CMHC is received and the homeowner pays contractor.
The RRAP program is more extensive than most believe, however. For instance, in-house elevators are eligible for the purpose of improving accessibility for disabled occupants. RRAP is the only government program that allows for the installation of an elevator in home.
Also, landlords can apply for up to $24,000 for modifications to rental suites to make them more accessible to persons with disabilities.
Accessible assistance
Other funding is available, under a separate federal program, to handle other home improvements to create a more accessible living space for older homeowners.
This program is known as the Home Adaptations for Seniors’ Independence (HASI). It provides assistance for such things as handrails installed by the stairs to a basement, or a grab-bar in the shower. It can also cover some of the cost of installing a wheelchair ramp, stair lifts or non-slip flooring.
Who is eligible for HASI? Homeowners and landlords alike may qualify for assistance, as long as the occupant of the dwelling meets certain criteria. These include: being 65 years of age, or older; experiencing difficulty with normal daily activities brought on by aging; and living in their own permanent residence. The occupant must also have a total income below a certain threshold, which varies depending on where he or she lives in Canada.
Those who qualify for HASI can receive financial assistance of up to $3,500.
CMHC also offers ways to help people who want to convert space in existing dwellings to create secondary suites or build garden suites for low-income seniors. For more information about HASI or the RRAP programs from CMHC programs, call 1-800-639-3938 or visit www.cmhc.ca.
Reprinted from: Home Makeover May/June 2007 |
Departments 
Business in Vancouver is your source of regional business intelligence since 1989.